A payment gateway is basically an interface between your online store and the high risk payment processor which, as the name implies processes the buyer’s credit card. The payment gateway processes the credit or debit card data and authorizes or not, the payment, making sure that the encrypted data of the card is correct, that there are funds in it and that the process is carried out in a safe. However, payment gateways cannot determine whether a card has been stolen or cloned and therefore cannot be held responsible for refund requests.
For those who own an e-commerce website or sell products and services online, accepting credit and debit cards is a major factor in acquiring more customers. The risk of scams remains for both sellers and payment gateways. Therefore, we must understand that for payment gateways offshore companies that do not have an office, a real corporate headquarters and are often anonymous, have a high risk and, for this reason, the payment systems that accept offshore companies are rare, quite tedious and charge high commissions.
How does a payment gateway work?
The great advantage of a payment gateway is that you do not have to worry about the technical part; in fact, the processor will provide you with all the technical details and the connection API so that your online business can collect payments made by credit card or debit.
The customer enters your site, chooses the product or service they want, with one click places it in the cart and when they are ready to pay, they send it to check out, that is, to enter, safely, the data to pay, the data is encrypted and sent to the card company: Visa, MasterCard, Diners, Union Pay, etc. If the payment is successful, the seller and the buyer receive a confirmation and the buyer can return to the site. What are the restricted or prohibited activities that are considered risky by the payment gateways?
For banks and payment gateways, high-risk businesses are those that cause many doubts due to the high rates of fraud and chargebacks or borderline activities, that is, they can easily fall into the illegal. Among those businesses are casinos, bingo halls, poker rooms, auctions, travel agencies, grow shops, legal services, tarot cards, erotic content, drugs, energizers, vitamins, Forex, offshore services and many more. In the case of the latter, banks and gateways do not fear that working with entities that do not have a stable organization, nor a contact telephone number or hired personnel, will become an impossible risk to assume.
The refusal to work with offshore companies by more than a few payment gateways constitutes a serious problem, since they also need to process payments from their clients and do so safely. But, for the gateways, the risks are high since most offshore companies operate with borrowed directors and virtual offices. Fortunately, there are several payment gateways that continue to accept risky businesses and in this article we share the characteristics and advantages of each one.
Offshore payment gateways
Offshore payment gateways are the best solution for high-risk businesses that have not been able to use traditional ones. These are smaller payment entities that do not pay too much importance to the characteristics of a certain offshore company or the products or services for sale. It is precisely for this reason that the commissions they charge are usually very high.